The rich get richer…

Newspaper headlines in South Africa these days report on spiraling inflation, and warn that interest rates could be raised yet again. I’ve lost count of the number of times our Reserve Bank has hiked interest rates, and it’s beginning to take its toll. There are also reports of record numbers of South Africans defaulting on house, car and other payments. Even the banks have started changing their tune — for example, First National Bank has launched a major advertising campaign offering tips on saving money, and explaining that they’re getting tougher on granting credit.

But it’s not bad for everybody. Yesterday’s Business Times lead with the following headline: “SA’s dollar-millionaire club gets bigger, faster”. The story explains that the growth in the number of South Africans with wealth of over a million US dollars was greater than the global average. In South Africa there are now almost 14% more dollar millionaires than there were this time last year. The global average was a 6% increase in dollar millionaires.

In fact the biggest growth in dollar millionaires was in the Middle East, and there are significantly more millionaires in South America too. And lest you think our continent is being left out, South African millionaires weren’t the only ones doing well.  This year there are 10% more dollar millionaires in Africa than there were last year.

That might all be wonderful news, except for the fact that in Africa, unlike almost everywhere else in the world, poverty is increasing, and intensifying. In an era where governments and international organisations have set the goal of halving poverty by 2015, that is shocking. It’s shocking that between 1990 and 2004, the number of Africans living on less than 1 US dollar a day increased by 20%. But it’s worse than that. The number living on less than 50 US cents a day rose by a third during the same period. That means that in sub-Saharan Africa there are now over 121 million people trying to survive on less than 50 US cents a day. At the current exchange rate, that’s the equivalent of about 4 South African rands a day.

Now all this is happening while economies are growing. The rich are getting richer, and the poor, poorer. Economies are growing, but unemployment is increasing. Clearly something is very wrong.

I’m not an economist and don’t have easy answers, but surely we have to question the political and economic leadership of our countries and continent. We also have to look to ourselves. How have we allowed this to happen? In South Africa, are those of us in the middle classes so caught up in the pursuit of material wealth, the latest clothes, and the flashiest cars, that we have been prepared to ignore the increasing misery of our fellow citizens? What can and should we be doing to turn this around?

To give a picture of just how insane this is, the Sunday Times article also mentions that among the ultra-rich — those worth more than 30-million US dollars, the biggest increase was in Latin America, followed by Africa.

Now let’s get real. How much money does any one person need? Let’s say, it’s fine and acceptable to do well and be comfortable, and let’s be very accommodating and say it’s not excessive to have $1 million US dollars. But over $30 million? What do you do with money like that? You can only sleep in 1 bed at night, eat so many meals, drink so much fine wine. What do you do with the rest? What is the point?

Especially when your fellow citizens are spending every waking hour trying to scrape together enough money for just one daily meal.

(This was first posted on the Citizen Journalism in Africa site on June 30th, 2008: www.citizenjournalismafrica.org)

When starving is a crime

What a bizarre world we live in.

Last week, I was watching Al Jazeera, where Riz Khan was interviewing Dr Rebecca Puhl, of Yale University’s Rudd Center for Food Policy. Now in my part of the world, when I see something like “Centre for Food Policy”, what crosses my mind are words like ‘hunger’, ‘agriculture’, ‘land access’ and ‘poverty’. But no, this institution’s full title is “Rudd Center for Food Policy and Obesity”, and Dr Puhl was talking about research on discrimination against, and stigmatisation of, obese people. (You can watch the interview on YouTube at http://www.youtube.com/watch?v=5eq6kK5NBCM&feature=user)

According to the centre’s research, many overweight people suffer from depression and suicidal thoughts because of how others treat them. It’s particularly bad for obese girls: the study showed that parents spend less on their education, and they are often denied entry into college.

The problem’s not only in America. In many other parts of the world, obesity is becoming an increasing problem.

And yet, at the same time, there’s increasing concern about people who are too thin. Also in the last week came the news that France is to pass a law making the act of promoting excessive thinness, a criminal offence. The French law is aimed at media and fashion circles, where excessive thinness is promoted as something to aspire to (http://timescorrespondents.typepad.com/charles_bremner/2008/04/frances-fondnes.html).

Meanwhile, in developing countries, food riots have been making headlines. Around the world, food prices have just about doubled in recent months, making it increasingly difficult for poor people to survive. One of the main contributors to food inflation is the increasing use of biofuels — many farmers have been switching from food crops to fuel-producing plants, thus causing food supplies to drop and prices to rise.

The problem is not that there’s not enough food to go around — it’s in the economics of food production and distribution. And poor people are far more vulnerable to food price hikes. In poor nations, people spend up to 80% of their disposable income on food, while in countries such as the US and Britain, the figure is somewhere between 10% and 20%. So for rich folk, food inflation is simply an inconvenience, while for others, it’s a matter of life and death.

Political analysts have long warned that high levels of economic inequality spell danger for democracy. Comparative historical research has shown that democracy lasts longer in countries where there are lower levels of inequality. And in South Africa, people like Professor Sampie Terreblanche (http://en.wikipedia.org/wiki/Sampie_Terreblanche) have been warning for years that we are sitting on a time bomb — it’s just not sustainable to have enclaves of first world wealth, surrounded by extensive poverty.

The unions have already warned that we can expect food riots in South Africa in the near future. More and more poor people are struggling to put food on the table — but for the middle class nothing more than a little belt tightening is required. A street survey by The Times newspaper found that while middle class folk are cutting back on some luxuries, most don’t intend to sacrifice ‘necessities’ such as digital satellite TV subscriptions.

Of course, our politicians have seen the problem and are taking bold action to resolve it. Finance Minister, Trevor Manuel, has offered the helpful suggestion that we should all start growing our own fruit and vegetables.

It does seem criminal that some should be fighting off a glut, while others are starving. But nobody’s proposing a law that would compel the world’s politicians to put policies in place to wipe out hunger. No, it’s only a crime when the media and fashionistas persuade those who CAN afford plenty of food, not to eat it.

(This piece was first published on the Citizen Journalism in Africa portal: www.citizenjournalismafrica.org/blog/%5Buser%5D/17-apr-2008/801)